A Melbourne-based consultancy firm has outlined 10 ideas for Malaysia to get retirement and aged-care services off the ground.
Essential Economics Pty Ltd is part of the Essential Economics International group based in Melbourne, Australia.
It is a consultancy firm specialising in urban economics, infrastructure and urban development in Australia and the Asia-Pacific region.
Retirement living and aged care, a rapidly developing sector, is one of its expertise. Its work includes undertaking market assessments, identifying geographic hot spots for such developments, providing advice on price points, and assessing project design and the range of associated amenities, its website says.
During a recent visit to Malaysia, Essential Economics’ managing partner Sean Stephens outlined several areas that Malaysia must consider if it were to provide any form of retirement and aged-care services.
Says Stephens: “Get the pricing and ownership model right. There is a need to understand the market with high-quality market research, demographic analysis and focus groups.”
He suggests learning from countries that have taken this path to build the industry. “Learn from countries that have already been doing this for 20-plus years and be prepared to tailor-make a ‘Malaysia’ solution,” he said in his presentation entitled “Sustainable Australian Retirement Villages”.
He was speaking at the “Invest and Succeed in Mixed Use Development” seminar organised by Malaysia Property Inc on Aug 28.
Because building retirement villages is something that is new in Malaysia, educating the market is crucial.
To get the template right, Stephens says it is absolutely necessary to implement industry standards, protocols and collaboration to minimise the danger of rogue operators who damage industry reputation. Building an eco-system for this industry to succeed requires Government leadership and support. The principle of this industry seeks to maximise the independence of an ageing population.
“The focus is not healthcare or aged care, but to be able to live independently with the highest quality of life within the framework of the retirement village.
“The cost of an ageing population to society is reduced if seniors are able to remain independent for as long as possible,” he says.
Stephens highlights that 5% of the population aged 65 and above are in retirement villages in Australia, compared with 10% in the United States.
Because the industry is new in the country, he says there might be a need to form joint ventures with existing international operators.
Anyone or any entity that embarks on this industry must recognise that retirement villages are a long-term asset to a country and to the society it is located in.
To ensure its sustainability, retirement villages require ongoing care and management.
Issues like site selection is important, he said, during a rundown of 10 ideas for the industry to kick off in Malaysia.
“There must be a national regulatory framework, rather than a state-by-state one,” he says.
Stephens says there are many reasons which contribute to integrated retirement living in Australia.
“Residents must feel safe and secure at all times for their own peace of mind and that of their families. Access to off-site services like shops, healthcare, safe and easily available public transport is a must.
“The availability of on-site recreation facilities is critical, although this is complementary to off-site facilities,” he says.
“Structure your pricing model to attract the demographic that is the best fit for the particular retirement village,” adds Stephens.
On the Australian experience, Stephens says the dominant focus of the Australian retirement village industry is to provide long-term residential accommodation for older people to enable them to live ‘independently’ for as long as possible.
“The focus is not so much on healthcare or aged care nursing.
“However, having said that, basic health and support services are provided, but this is only in order to support the independent living arrangements of residents.”
The industry, he says, is characterised by a mix of for-profit and not-for-profit operators.
Despite the presence of some operators with large portfolios of villages, the industry in Australia remains highly competitive in a highly regulated environment. They are also required to comply with the Australian Government-determined funding arrangements, legislation and regulation, he says.